Maximin
Maximin chooses the option with the best worst-case payoff when probabilities are not used in the rule. Identify the minimum payoff for each alternative and select the largest of those minima. It is a conservative criterion but may sacrifice substantial upside and is not automatically the best expression of every risk-averse decision-maker’s preferences. Cost-minimisation cases require careful translation of the rule and signs.
Worked example
Option A pays 100 or 20; B pays 70 or 60. Worst outcomes are 20 and 60, so maximin selects B.
Common mistake
Choose the highest of the minimum payoffs, not the lowest number in the whole table.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | PM | Direct | September 2026–June 2027 |